Scottish Court of Session Decisions

Lord Justice-Clerk (whose opinion was read by Lord Stormonth-Darling).—In this case the heir in heritage of the late Mr M'Caig of Oban seeks to establish her rights as such, notwithstanding the fact that he has made a testament in favour of trustees, and has directed them to hold his estate and to apply the proceeds in doing certain things on the estate. She does not impugn the deed on the ground of mental incapacity. She attacks it on the ground that it does not give any disposal of the estate for the benefit of any person or class of persons, and is in no better position to exclude her than if it had simply disinherited her without putting anyone in her place, which it is plain would not have invalidated her right as heir.

Now, what was it that Mr M'Caig expressed in the deed? What was his desire and intention? He seems to have been possessed of an inordinate vanity as regards himself and his relatives, so extreme as to amount almost to a moral disease, though quite consistent with sanity. Accordingly his desire was that towers—artistic towers he calls them—similar to one which he had during life erected on his property overlooking Oban, should be built on all prominent places, and that his own likeness and that of his brothers and sisters should be perpetuated in colossal statuary in stone or bronze placed on these towers. That was the only real purpose to be served by the establishment of the trust. It was no gift to anyone. It was solely a scheme for setting up so much stone building and statuary, and nothing else. Up to this point therefore there was no beneficiary for whom he disinherited his heir. It could hardly be held that these towers and statues could be a benefit to Oban, although I do not doubt that he thought so, but certainly no beneficial enjoyment could result to anyone.

Thus in its main purpose the deed of the late Mr M'Caig was intended to cause the revenues of his lands to be applied in all time coming to tower building and statue making without any purpose beyond of any kind. If there was nothing more than this in the deed I should have no hesitation in holding that no effectual taking of the right to the property out of the heir had taken place. Even if the purpose could be described as a distinct and definite purpose, there would be absolute vagueness, if not absolute darkness, as to what beneficial interest was being conferred on anyone by the exclusion of the heir. Nor is there any purpose which can be held to have any definite outcome. The trust is one which cannot be carried out as directed to the end of time. A day must come when the trustees could no longer do anything under the trust—notwithstanding that it is perpetual for all time coming—and when they could make no answer to the then heir should he demand that the lands, with their towers and statues, should be made over to him. In such circumstances can it be said that the testator has successfully shut the present heir out of her rights? Where is the beneficial interest the trustees are required to protect? Where is the beneficiary that is preferred to her?

The suggestion is made that this bequest falls under the category of “charitable,” because the testator wishes that the designing of the statues, &c. is to be made matter of competition among “young and rising artists,” and that prizes are to be given to competitors. But I am unable to see in what way it can be held that this is charity. It is quite a common thing to stimulate competition in designs for buildings by giving a premium to competitors who may fail to be chosen for the work. But that is not charity. It is an inducement held out to persuade men to spend their thought and their time in making designs, and so supplying the person wishing to get good designs to choose from—designs which are the fruit of earnest labour. But the mere fact that some pecuniary reward is to be given does not in the least constitute such employees or selected competitors beneficiaries under the trust. The direct purpose of their employment is to obtain good designs to carry out the true purpose, viz., the building of the artistic towers or the provision of artistic statues of the M'Caigs, if that be possible.

It cannot be suggested for a moment that any young or rising artists would have a title to come forward as beneficiaries and require the trustees to give them an opportunity of competing for prizes. It is not an educational trust in any sense like the trust in Whicker's case, and it is only if it can be called educational that I think that in this case it can be called charitable. The trustees are not to take in hand any work of education. They are only to select artists to compete for prizes in order to get designs for carrying out the artistic towers and statues. In that there is, as I think, nothing either educational or charitable. They are simply to allow a competition and to give prizes to those whose work they approve of. They select artists and ask them for designs, and reward those who furnish good ones. How that by any stretch of reason can be called charitable or educational I cannot conceive.

I do not think that in setting aside this deed as not substituting any beneficiary in place of the heir the Court will be in any way narrowing the powers of a testator to deal with his estate as he will. A testator who desires to confer a benefit on an individual or a class can have no difficulty in doing so. But in this case I cannot hold that this has been done by this eccentric testator, and I am of opinion that the heir is entitled to prevail.

Lord Kyllachy.—In the view which I take of this case it does not appear to me that we are called upon to decide, at the present time, any question except this: Whether the pursuer is entitled to have it declared in terms of the first part of the first conclusion of the summons that, except as therein mentioned, the trust-settlement and codicil of 20th January 1900 and 18th February 1902 are ineffectual to dispose of the estate and effects of the deceased John M'Caig. There are alternative conclusions which ask declarations of a more limited character. And there are also questions which may remain behind with respect to the efficacy of certain earlier writings of the deceased—questions which may come up for determination afterwards. But the primary declarator, if affirmed, supersedes all that follows; and as regards the earlier writings I do not myself see how, in the first place, the writing of 19th June 1893 raises really any separate question; or, in the next place, how, as regards the two earliest writings—those of 1883 and 1891—we could dispense with at least some inquiry; or, even apart from that, how the pursuer could be allowed to try the question arising upon those writings, between herself as an individual and herself as sole trustee and executor under them. It will be observed that in this part of the case the pursuer in her official capacity is the only person called as defender.

With regard, however, to the primary declaration—to which I should perhaps note the pursuer's counsel invited us to confine our attention at this stage—I am of opinion that we may and ought to affirm it; doing so, substantially, on the leading ground maintained by the pursuer's counsel in argument, viz., this, that the trust-deed before us does not, except to the extent mentioned, divest the truster's heir, but leaves her (i.e., the pursuer) still in the beneficial ownership of the estate, heritable and moveable; doing so in respect that it (the trust-deed) creates no beneficial interest in any third person, or body of persons—even including in the latter category the general public.

I do not propose to express my final opinion upon the pursuer's contention that the purposes of the trust are void from uncertainty. As at present advised, I think that would be a difficult proposition. For while there are undoubtedly some points in the deed which present difficulties of construction, and others upon which the truster leaves a perhaps unusual latitude to his trustees, I am not—at least as at present advised—satisfied that the testator's intentions—whatever their character otherwise—are unascertainable—that is to say, incapable (if effectual otherwise) of being gathered and carried out, either wholly or to a substantial extent.

Neither do I find it necessary to rest my opinion upon what is perhaps a wider ground than that above indicated, viz., this, that the trust purposes (except as aforesaid) are void as being contrary to public policy. I have, I confess, much sympathy with that argument. For I consider that if it is not unlawful, it ought to be unlawful, to dedicate by testamentary disposition, for all time, or for a length of time, the whole income of a large estate—real and personal—to objects of no utility, private or public, objects which benefit nobody, and which have no other purpose or use than that of perpetuating at great cost, and in an absurd manner, the idiosyncrasies of an eccentric testator. I doubt much whether a bequest of that character is a lawful exercise of the testamenti factio. Indeed, I suppose it would be hardly contended to be so if the purposes, say of the trust here, were to be slightly varied, and the trustees were, for instance, directed to lay the truster's estate waste, and to keep it so; or to turn the income of the estate into money, and throw the money yearly into the sea; or to expend the income in annual or monthly funeral services in the testator's memory; or to expend it in discharging from prominent points upon the estate, salvoes of artillery upon the birthdays of the testator, and his brothers and sisters. Such purposes would hardly, I think, be alleged to be consistent with public policy; and I am by no means satisfied that the purposes which we have here before us are in a better position. Still, it seems to me that the pursuer is perhaps on safer ground when she appeals, not to considerations of public policy, but to the definite rule of law already referred to, a rule perhaps ultimately founded on public policy, but also, and perhaps primarily, on considerations as to what is right and just as between the varied interests in a deceased's succession. Accordingly, I prefer to rest my judgment upon the doctrine which I have expressed—a doctrine which, whatever questions may arise as to its application, is itself elementary, and rests upon the cardinal principle that by the law of Scotland there can be no divestiture of a man's heirs or next of kin, except by means of beneficial rights, validly constituted in favour of third parties. Authorities are perhaps superfluous, but reference may be made to Bell's Principles, secs. 1682, 1691, 1692, Ross v. Ross, and to the cases of Gardner, Neilson, and Cowan, mentioned in the Lord Ordinary's note.

Taking then the question to be whether any beneficial interests are by this deed created in favour of third parties, What are the interests which are said to be so created? and who are the persons or classes of persons said to be benefited? I put that question to the defenders' counsel at the close of the argument, and the only answer I obtained was a reference to the direction in the settlement that the making of the statues or monuments was to be given to Scotch sculptors, and that in order to encourage “young and rising artists” there should, before building the proposed statues and artistic towers, be prizes given for the best plans of the said statues, towers, &c. In short, the suggestion seemed to be, and it was really the only suggestion offered, that in respect not of the directed employment of Scotch sculptors (for that would perhaps have been too extreme), but of the incidental benefits arising to Scottish art and Scottish artists from the institution of prizes for plans of the artistic towers, &c., the bequest was really elevated into the category of an educational or charitable bequest, being practically in the same position as if the direction had been to apply the testator's estate in endowing say an Art School in Oban or elsewhere in Scotland.

Now, it must be confessed to be a somewhat difficult proposition that the expenditure of several thousand pounds a year upon the erection of artistic towers or other purposeless structures upon a remote Highland estate can be defended upon the ground that, incidentally, it will or may include a beneficial expenditure in the shape of prizes, to be offered from time to time in connection with the designs for the work. If the cost of the designs represents the whole extent to which the expenditure is said to be for the endowment of art, it may, perhaps, be observed that the prizes can be bestowed without the erection of the artistic towers; and that the pursuer, if she were once assured that her estate was to be freed from the artistic towers, would not probably have much difficulty in accepting the burden of the prizes; all the more as that burden is not perhaps likely to prove very onerous, unless the young and rising artists designated have different ideas of their profession, and are less sensitive to public ridicule than is generally supposed. Apart, however, from all this, and treating the matter as far as possible seriously, it seems to me to be a sufficient answer that if a trust purpose is of such a character that if, when executed, it will benefit nobody, it cannot affect the legal result that, in the course of executing the trust, there will or may be some employment of labour, or the receipt of wages or salaries by deserving persons. An administrative trust, as we know, cannot be maintained against the will of an unlimited fiar; and it would not, I suppose, be contended that in that case it would affect the result that somebody had been named by the deed as factor or law-agent, still less that certain employees were to be selected from some professional class. And if that be so, it seems to me to be equally difficult to suggest that the trustees here, if otherwise bound to denude, can resist doing so by reference to the incidental interests of Scottish sculptors, or of young and rising artists, or even (what would be perhaps more to the point) of the respectable gentleman whom they are desired to appoint as factor and law-agent to the estate.

I may add two observations which perhaps express merely different forms of the same argument.

In the first place, the trust here and the directed expenditure are in terms made perpetual. But, plainly, they cannot go on for ever, or, indeed, for a very long time. The number of statues is limited; and the multiplication of artistic towers must sooner or later satisfy any reasonable view of the trustees' duty. In that case it was not disputed that the heir (i.e., the pursuer) or those in her right would be entitled to step in. In other words, the heir's enjoyment of her radical right is at best only postponed; and (subject to that postponement) her right is in itself indefeasible. But if that be so, what, it may be asked, is to prevent her stepping in now, and on the principle of the case of Miller's Trustees, and similar cases, claiming immediate possession, and the stoppage of operations on her estate which she does not desire, and in which no other person, public or private, has any stateable interest?

The other observation is this: It has been sometimes said that the test of the efficacy of a trust like the present is to inquire whether there is anybody who could enforce its performance; and there can be no doubt that that is a true proposition (indeed, really a truism) provided it be kept in mind that as regards trusts for charitable or educational purposes, or other purposes of public benefit, there may always be the intervention, if of nobody else, of the Crown. But if that be so, who, it may be asked, would have a title to enforce as against the trustees or the truster's heir the carrying out of the trust purposes here in question? Or (to put the same question in a perhaps simpler form), supposing the trust-disposition here had been in favour of the pursuer (the truster's heir), but burdened (like a Roman fidei commissum) with an obligation to do the things which are here in controversy, could anybody prevent the heir ignoring the disposition and the obligations attaching to it, and making up her title and possessing as heir alioqui successurus? It appears to me that that question would fall to be answered in the negative, and I do not see that the present case presents any material difference. It is perhaps unnecessary to add that I hope it may not be supposed (should your Lordships take my view of the matter) that we should be deciding anything against the validity of a testamentary disposition directed to the providing, on a customary and rational scale, a burial-place for a testator, or a suitable monument to his memory. Neither do I, at least, desire to decide anything against the validity of testamentary trusts for the erection in suitable situations of memorials to historical personages or to commemorate historical events. Such things may have an educational value and be a public benefit; as would perhaps also be expenditure in the same or other directions for beautifying or embellishing a town or neighbourhood. But it has not been nor, I am afraid, could it be suggested that we have anything of that kind here.

On the whole matter I am of opinion that we should, as already said, decern in terms of the first part of the first declaratory conclusion, and quoad ultra sist and continue the cause for further procedure.

Lord Stormonth-Darling.—With much in the Lord Ordinary's opinion I entirely agree, particularly when he speaks of the favour which has always been shewn to wills the provisions of which are expressed with sufficient clearness, and are not contrary to public policy or morals. I acknowledge also that this action has to be dealt with as not one for the reduction of these writings on the ground of testamentary incapacity, but as based upon the assumption that the testator was of sound disposing mind.

But where, I think, the Lord Ordinary has erred has been in rejecting what he calls the “broad and bold position” taken up by the pursuer's counsel as the first ground of his attack on this will. That position simply is, that a proprietor of Scottish heritage cannot deprive his heir by mere words of disinherison (Bell's Prin. section 1692), or as put by Lord Curriehill in Gardner v. Ogilvie : “An heir-at-law's right to succeed to his ancestor's heritage cannot be defeated except by a conveyance thereof granted by that ancestor, while in liege poustie in favour of a third party.” That statement of the law, which was described by Lord Curriehill as “a radical principle in the Scotch law of succession,” about which “there is not and cannot be any dispute,” was thus amplified by Lord Neaves in Neilson v. Stewart : “The law upon the several questions here involved appears to the Lord Ordinary to admit of no serious doubt. An heir cannot in this country be excluded from his right of succession by the mere will or intention of his predecessor, or by writings of a merely negative character. He cannot be disinherited by words to that effect, or by a simple declaration of a testator that his heritable estate is to be held as moveable. The heir may be excluded mortis causa in two ways, but, generally speaking, in two ways only—first, by a disposition in liege poustie in favour of a third party; and second by a trust-disposition in liege poustie, accompanied or followed by a direction as to the beneficial disposal of the heritage, also made in liege poustie.”

In this last quotation I emphasise the words “beneficial disposal” where there is a trust, for that expression obviously means a disposal for the out-and-out benefit of some individual or class of individuals, as distinguished from the mere indirect benefit which might be said to arise from a direction to build (say) a mansion-house without any direction as to the person for whose occupation and enjoyment it is to be built, and for whom it is to be held by the trustees. If so, it is impossible to regard in the present case the “Scotch sculptors,” who are to be employed by Mr M'Caig's trustees in the making of these family statues, or the “young and rising artists,” to whom prizes are to be given for the best plans of the proposed statues and towers, as at all coming up to the position of beneficiaries of the trust, in the sense of the rule as explained by Lord Neaves. Every trust which is created for the purpose of spending money upon anything—irrespective altogether of the nature of the purpose—must incidentally benefit somebody, such as servants, workmen, professional men, and the like, and none the less that they give value for the money which they receive—value, that is to say, in the shape of services rendered or skill employed. But in the ordinary use of language such persons are not described as beneficiaries of the trust, or as persons for whom the heritage is held by the trustees.

For what purpose, then, is this considerable landed estate to be withdrawn from commerce and its revenues accumulated in all time coming, so that it shall never be in the beneficial enjoyment of anybody? For the erection of ten large statues representing the members of a private family connected with Oban, and for the building of what the testator calls “artistic towers” on prominent points of the estate. I agree with the Lord Ordinary that it is not impossible to make out what the testator was driving at in these rather crazy directions, and that it would be difficult to hold them void from vagueness or uncertainty. I also agree with him that at some more or less distant date the directions may become unworkable and incapable of further extrication. And he is of opinion that, if that should happen, the pursuer or those in her right would be entitled to come to this Court, and might, under the altered circumstances, succeed in obtaining a judgment to which, as matters now stand, she is not entitled. But, in saying so, I think that his Lordship misapprehends the real nature of her objection. Her real objection is not, as it seems to me, based on the vagueness or uncertainty of the testator's directions, but on the ground that the testator has failed to oust her, as his heir-at-law, by substituting somebody else, whether a person or a class of persons, to take the beneficial interest in his heritage. If that be so, why should she wait till the purposes have for any reason failed? I can understand why the heir should be expected to wait if the immediate purposes are such as to oust him or her effectually in the meantime. This might happen if the immediate purposes could properly be described as “charitable,” or even perhaps of public utility. But the Lord Ordinary hesitates to describe this bequest as charitable, and merely says that he is “disposed to think” that it is “in the region” of charitable bequest. Even to that modified extent I demur to his Lordship's suggestion, at least if it means that the “bequest” is to be treated as a beneficial bequest to anybody, and is to receive the benignant construction appropriate to charitable bequests.

One way of testing the real nature of the trust purposes is to ask, who would have any title or interest to enforce them? Not the pursuer, for, although she is the last survivor and representative of the family which is to be handed down to posterity in stone or bronze, she naturally disclaims any wish to have them made ridiculous in this manner. Can it be suggested that any member of the public, merely as such, would have the right? And if not, could any “young and rising artist” come forward with a claim founded on the hope that he would win a prize, if prizes were offered for the best designs of the statues and towers? Or would he be in any better position than a quarrymaster or mason who insisted that he should have the opportunity of tendering for the erection of the statues and towers? To each and all of these persons I apprehend that the answer of the law would be, “You are not a beneficiary for whom this trust was called into being.”

On the short ground, therefore, that this is an attempt on the part of a testator to disinherit his heir without giving any directions to his trustees for the beneficial disposal of his heritage, I agree as to the manner in which your Lordships propose to deal with the case. The rule of law, as it seems to me, is much more than a merely formal one or framed merely in the interests of heirs-at-law. It is very easy to exclude their rights without at all affecting the legitimate freedom of testators. But it is really in the interests of public policy that testators should not be allowed to exclude their heirs-at-law, unless they take the trouble to provide some beneficial substitute.

Lord Low.—It is plain, I think, that by the holograph settlement in question the testator did not authorise his trustees to devote any part of the corpus or capital of the trust-estate to the purposes of the trust, but only the income, and that, too, to a limited extent. He first says that “the purpose of the trust is to pay all my legal debts and deathbed expenses, these debts are to be paid from the accumlations of the yearly income of the trust after the expenses of the management is paid.” The yearly income thus referred to includes, I think, the income of the whole trust-estate, whether heritable or moveable. The settlement then proceeds—“The purpose of the trust is that my heritable property be not sold but let to tenants, and the clear revenue or income be used for the purpose of erecting” certain monuments, statues, and towers. For that purpose, therefore, the trustees are only authorised to use the free income of the heritable estate which is not to be sold.

Except in so far as the trustees are authorised to expend income by the two clauses in the settlement which I have quoted, neither the income of the trust-estate, nor the corpus of the heritable estate, nor the moveable estate, are in any way disposed of.

Now, it is settled law that to disinherit the heir-at-law or to defeat the rights of the executor, it is necessary that the estate should be given to some other person. That not having been done in this case, the beneficial right to the heritable and moveable estates respectively passed to the heir-at-law and the executor at the testator's death. The pursuer represents both the heir-at-law and the executor, and the question is whether she can object to the purposes to which the trustees are directed to apply the free income of the heritable estate being carried out, and demand immediate conveyance and payment of the whole estate, heritable and moveable.

So far as the moveable estate is concerned, I think that (leaving out of view in the meantime the question which is raised in regard to earlier settlements made by the testator) there is no answer to the pursuer's claim, because, except for the purpose of paying the debts and deathbed expenses of the testator, neither the income nor the capital of the moveable estate is in any way disposed of, nor are the trustees authorised to use or expend either the one or the other. Perhaps the same remark applies to what the testator calls “the property of the gas-works,” which the trustees are authorised to sell, and which the testator refers to as not being part of the “unsaleable estate,” by which he plainly means the heritable estate which is not to be sold, and the revenue of which is to be applied in erecting statues and towers.

In regard to the latter estate the question is more difficult. The purposes to which the testator directed his trustees to apply the free income of that estate, although whimsical and of no utility, are perfectly lawful, and cannot, I think, be regarded as contrary to public policy. But then there is no human being and no public body who have an interest to require the trustees to carry out these purposes, while, upon the other hand, the heir-at-law has a very material interest to object to the estate, which is hers, being withheld from her for an indefinite period to allow of a number of statues and towers, which, when completed, will benefit no one, being erected upon the land. I did not understand it to be seriously disputed that (assuming the trust purposes to be carried out) when the trustees had erected such statues and so many towers as, in their opinion, were required to carry out the testator's wishes, they would, there being no trust for maintenance, be bound to convey the estate to the heir-at-law. But upon that being done, the heir would be perfectly entitled to throw down the statues and demolish the towers, and that being so, I think that the pursuer is entitled to object to the statues and towers being erected at all, because she has an interest to object and no one has an interest to insist.

It was argued, however, that the trust was, at all events to a sufficient extent to make it impossible for the Court to prevent the carrying out of the trust purposes, a charitable bequest. That argument is founded upon a direction which the testator gives that “the making of these statues is to be given to Scotch sculptors,” and the statement that his “wish and desire is to encourage young and rising artists, and for that purpose prizes to be given for the best plans of the proposed statues, towers, &c., before building them.”

I doubt very much whether that can be regarded as a charitable purpose at all, but, however that may be, I think that it is clear that the trust cannot be regarded as one for charitable purposes. The object of the trust was to perpetuate the memory of the M'Caig family, and of the testator in particular, and his desire to encourage young and rising artists was entirely subsidiary to that leading purpose. It seems to me to have amounted to no more than this, that as statues and towers were to be erected at anyrate, it was desirable to take advantage of the opportunity thereby afforded of encouraging young and rising artists. If the testator had been told that his idea of erecting statues and towers could not be carried out, there is no reason to suppose that he would have devoted his means to any such purpose.

I therefore agree with your Lordships that decree should be pronounced in terms of the first part of the first conclusion, which will leave the questions which are raised upon the earlier settlements of Mr M'Caig to be determined in an appropriate action.